Discharged bankruptcy what you need to know about bankruptcy discharge. introduction I recently read a Manitoba Court decision issued in late, October. both the position taken by a judgment creditor And then I’m discharged bankruptcy RI. The Creditor holding the Judgment realize that the bankruptcy discharge would discharge that debt. So they try to convince the court that their deck fit into one of the limited classes of debt that is not discharged by the bankruptcy discharge. That court case reminded me that is not so unusual. Many times a creditor who holds a judgement against the undischarged bankrupt. tries to bootstrap their position One of the leading cases cited by the Manitoba Court. Is a 2018 decision from the court of appeal for Ontario? The purpose of miss Brandon’s blog is to describe the bankruptcy discharge process the position taken by the Judgment creditor. And what the court has to say about that? How bankruptcies work in Canada? the Canadian bankruptcy legislation Is open for an insolvent and not viable company? Or for the insolvent honest but unfortunate person can obtain relief. Subject to the rights of trust claim and secured creditors that company or person is assigning all of their hunting cupboard assets to the license insolvency trustee. Formerly called the bankruptcy trustee. In return the bankrupt person can have all of their debts discharged. subject to certain exceptions The bankruptcy discharge is amongst the primary advantages of relief under the bankruptcy and insolvency act Canada. The discharge is vital to the bankruptcy procedure. Debtors after bankruptcy can wipe the Slate tidy as well as begin over. This is a central concept under the Bia law. That is the essence of the bankruptcy discharge meaning. Bankruptcy discharge is when the bankruptcy is released under Canadian Bankruptcy Law Firm his or her financial debts as part of the bankruptcy discharge procedure. Some people think that it is the declaring for bankruptcy that releases the insolvent from obligation. This is not the case. It is the discharge that releases of bankrupt from debt. Bankruptcy discharge provides the discharge of all unsecured debts except for support payments to a previous partner or two children. penalties or fines enforced by the court Financial debts arising from fraud or fraudulent breach of trust Student loans if less than 7 years have actually passed since the bankruptcy. Stop being a part-time or full-time student. Trustee opposed discharge a first-time bankrupt who does not need to pay Surplus income. Is entitled to an automatic discharge after 9 months? This is shoes that they have lived up to all of their obligations as an undischarged bankrupt and fully cooperated with the licensing insolvency trustee. If this first time bankrupt is subject to Surplus income. Then they must pay it for 21 months before they are entitled to a discharge. longer timelines apply for a second or more time bankrupt Is the trustee has evidence that the bankrupt has not been forthright and fully cooperative. Or has actually committed one or more bankruptcy offences. And the trustee has a duty to oppose the bankruptcy discharge. notice of opposition to discharge Similarly any unsecured creditor can oppose the bankruptcy discharge. the grounds of opposition Would like lies be evidence of a lack of honesty or that one or more offenses have been committed. The process for a creditor opposing the discharge of the bankrupt is by filing a notice of opposition to discharge. And either a trustee or creditor oppose discharge the bankruptcy application for discharge must be heard in bankruptcy court. For more on the discharge process. You can read about it in one of my previous Brandon’s blogs. The Judgment creditor many times a judgment creditor thinks they have a higher position in the pecking order than other unsecured creditors because they have a judgement. They may have even registered the Judgment against the title to real estate owned wholly or partially by the defendant. Unfortunately upon the bankruptcy of a person. all enforcement proceedings on a judgment must stop The Judgment for a debt in bankruptcy is merely a piece of paper that proves you have an unsecured debt. nothing else Anyone who understands the litigation process knows that there is a big difference between getting a judgment and collecting on. Judgment creditors may take a Keener interest in the bankruptcy proceedings including opposing the discharge from bankruptcy. The reasons for this are twofold. The Judgment creditor has already spent time in court. Money on legal fees and still have not collected their debt. So they are more invested in this person’s bankruptcy than someone who did not go the courtroom. They are hoping that they can somehow fit their judgment for money only into a position where they can claim that the dead is one not released by an order of this church. It is the second reason that this Manitoba court case and the court of appeal for Ontario decision room light upon by the Manitoba Court. revolves around Can more evidence be introduced by a judgment creditor at the discharge hearing? Most judgments that I see in a debt settlement program under the Bia or in bankruptcy tend to fall into the same category a service or good was supplied and not paid for. The contract was entered into it was breached. That is just normal business. There is no fraud embezzlement misappropriation. defalcation fraudulent misrepresentation or fraudulent breach of trust It is simply someone owes money and didn’t pay. The plaintiff entered all of the evidence. They thought was important the defendant either defended or allowed for default judgment to be obtained because they did not defend. Regardless the court ordered the plaintiff. to be paid The Judgment creditor was unpaid and then one day receive the trustees notice of bankruptcy in the mail. The Judgment creditor was incensed. The Creditor took an active interest in the bankruptcy proceedings and maybe even served as a bankruptcy inspector. Today per person is now entitled to apply for his or her discharged from bankruptcy. A judgment creditor is unhappy. Because they now know that they are receiving either nothing or a small dividend from the trustee compared to the debt to be written off. So they now oppose the bankruptcy discharge and try to get new evidence submitted to the bankruptcy court to somehow prove that their judgment is a claim that is not extinguished by the person’s bankruptcy discharge. This is what the court of appeal decision was all about. Can you introduce new evidence at a bankruptcy discharge hearing? The case. I am referring to lawyers professional Indemnity Company versus Rodriguez 2018 on CA 171 Kenley. The appeals court said that the answer is no. You can read the entire decision here if you like. The court of appeal essentially said that the court has allowed to look at the judgment. The proof that would certainly have been entered as evidence at the time in the pleadings. As well as that evidence, which has been LED in the bankruptcy discharge hearing. To analyze whether the Judgment that falls within an exclusion to the general discharge rules. The court also said that in a bankruptcy discharge hearing the application judge was limited to looking at the Judgment the pleadings the statement of claim and any statement of Defence to determine whether the Judgment fell into the class of those debts not released by a discharge from bankruptcy new evidence is not allowed. This finding has been followed and further clarify. It is now apparent that the only purpose of a bankruptcy application for discharge is to consider the bankruptcy application.